WASHINGTON (dpa-AFX) - Following the pullback seen over the past several sessions, treasuries moved back to the upside during trading on Tuesday.
Bond prices moved higher early in the session and remained in positive territory throughout the day. As a result, the yield on the benchmark ten-year note, which moves opposite of its price, fell by 2.1 basis points to 4.239 percent.
The rebound by treasuries came as traders looked ahead to the release of key U.S. economic data later in the week.
Focus is likely to shift to a report on personal income and spending in June, which includes readings on inflation said to be preferred by the Federal Reserve.
The data could have a significant impact on the outlook for interest rates, with the Fed currently widely expected to lower interest rates by a quarter point in September.
Treasuries may also have benefitted from the release of the results of the Treasury Department's auction of $69 billion worth of two-year notes, which attracted well above average demand.
The two-year note auction drew a high yield of 4.434 percent and a bid-to-cover ratio of 2.81, while the ten previous two-year note auctions drew a high yield of 2.61.
The bid-to-cover ratio is a measure of demand that indicates the amount of bids for each dollar worth of securities being sold.
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